By Fast Brokers – The USD/JPY is continuing its sideways action while floating around the highly psychological 90 area. Uncertainty in the EU hasn’t had much of an impact on the USD/JPY thus far as loose monetary policies from both the BoJ and Fed offset one another. While investors may expect the USD/JPY to decline with pullbacks in the risk trade, the currency pair has held firm since the BoJ maintains its loose monetary policy stance while the Fed tightens a tad. Underperformance in Japan’s economy coupled with a dovish stance has given investors little reason to buy up the Yen over the Dollar for safety. Meanwhile, weakness in the risk trade seems to be capping upward movements in the USD/JPY since they tend to have a positive correlation. Although consolidation in the USD/JPY has carried on for quite some time, investors shouldn’t become complacent since the currency pair is prone to periods of accelerated activity. Japan will release Trade Balance data during tomorrow’s trading session followed by the UK’s budget and key data from the EU and U.S. Investors will likely pay particular attention to U.S. durable goods data since consumption of lasting products can give us a barometer in regards to the health of Japan’s manufacturing industry.
Technically speaking, the USD/JPY faces multiple downtrend lines along with intraday, 3/18, and 3/12 highs. Meanwhile, the highly psychological 90 area could continue to have an influence over the USD/JPY’s movements for the near-term. As for the downside, the USD/JPY has multiple uptrend lines serving as technical cushions along with intraday and 3/18 lows. .
Present Price: 90.26
Resistances: 90.37, 90.47, 90.57, 90.71, 90.79
Supports: 90.16, 90.12, 90.06, 89.99, 89.94, 89.84
Psychological: 90, March highs and lows
(click chart to enlarge)
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